12 - Sustainability Management Accounting Flashcards
what is sustainable development?
meets the needs of the present without compromising the ability of future generations to meet their own needs
what is corporate sustainability?
Focuses on achieving a sustainable economy, a sustainable environment and a sustainable society
Sustainability may improve business profitability
what is a sustainability report?
- measure and communicate economic, eviro, and social impact of org’s activities
e.g. Corporate Social responsibiity report
it is voluntary
what are the Three Pillar Sustainability Model for Businesses?
Triple Bottom Line (TBL) - 3Es & 3Ps
Economy - Profits Growth, Jobs, Taxes Products Services
Environment - Planet Eco-efficiencies
Eco-effectiveness
Equity (social) - People Employees Community / Culture World
Integrated Reporting (IR) is?
how an organisation’s strategy, governance and prospects, in the context of its external environment, lead to the creation of value in the short, medium and long term
• Benefits of reporting sustainable performance?
–Identify impact of business and stakeholders
–Strategy to manage risk and opportunities
Sustainability and stakeholders?
- Stakeholders can influence the business or be influenced by it
- Changing demands of the organisation’s stakeholders e.g. customers seek ‘green’ product
- Identification of stakeholders and assessing their influence
• Organisations that produce sustainability reports need and adopt?
–Need a reporting cycle to produce and report relevant data
–Adopt a sustainability strategy to monitor and improve EES
Management accounting needs to incorporate?
a sustainability focus on costs and performance into a range of decision contexts
Environmental Management Accounting (EMA) consists of?
Consists of MA systems and practices that provide information about environmental impact of an organisation’s activities
Environmental Management Accounting (EMA) help manage?
environmental performance
Environmental costs
Costs incurred to prevent, monitor and report environmental impacts and the costs of non-compliance with environmental regulations
Using Balanced Scorecard as Sustainability Performance Measurement System (SPMS)?q
- Sustainability measures may be included within the four perspectives
- An environmental or social perspective may be added to the BSC
- A separate sustainable scorecard may be developed
- Strategy maps may be developed to identify cause and effect relationships between objectives, strategies and to guide the selection of performance measures
Sustainability and capital expenditure analysis?
- Inclusion of environmental costs and benefits may affect the attractiveness of a project
- Weighting given to environmental factors depends on the organisation’s values and preferences
- Some capital expenditures are driven by the need to be environmentally and socially responsible
Important factors in capital investment analysis?
productivity, future regulation, potential liability, insurance, company image
